Alphbaet Inc. GOOGL, -0.16% GOOG, -0.18% shares fell more than 2% in the extended session Monday after the company beat Wall Street estimates for earnings and revenue. The company reported fourth-quarter net income of $8.95 billion, or $12.77 a share, compared with losses of $3.02 billion, or $4.35 a share, in the year-ago period. Changes to the U.S. tax code resulted in a $9.9 billion expense in the fourth quarter of 2017. Revenue rose to $39.28 billion from $32.32 billion in the year-ago period. Analysts surveyed by FactSet had estimated earnings of $10.86 a share on revenue of $38.9 billion. For the first quarter, analysts models earnings of $10.45 a share on sales of $37.2 billion. Alphabet stock has gained 2% in the past year, with the S&P 500 index SPX, +0.47% falling 2%.
However, despite the rising revenues and net income, the company's stock traded down following the announcement, with investors concerned over the increase in the 'cost of revenues' lines in Alphabet's consolidated statements of income, from $45.6bn in 2017 to $59.5bn in 2018.Research and development also increased by just under one-third, from $16.63bn to $21.42bn.
